REPT BATTERO Energy Co., Ltd.'s (HKG:666) Path To Profitability

With the business potentially at an important milestone, we thought we'd take a closer look at REPT BATTERO Energy Co., Ltd.'s (HKG:666) future prospects. REPT BATTERO Energy Co., Ltd. engages in the design, research and development, production, and sale of lithium-ion battery products in China and internationally. With the latest financial year loss of CN¥1.5b and a trailing-twelve-month loss of CN¥1.2b, the HK$25b market-cap company alleviated its loss by moving closer towards its target of breakeven. The most pressing concern for investors is REPT BATTERO Energy's path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

View our latest analysis for REPT BATTERO Energy

REPT BATTERO Energy is bordering on breakeven, according to the 4 Hong Kong Electrical analysts. They expect the company to post a final loss in 2025, before turning a profit of CN¥939m in 2026. Therefore, the company is expected to breakeven just over a year from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 68% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving REPT BATTERO Energy's growth isn’t the focus of this broad overview, however, take into account that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we would like to bring into light with REPT BATTERO Energy is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in REPT BATTERO Energy's case is 90%. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of REPT BATTERO Energy which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at REPT BATTERO Energy, take a look at REPT BATTERO Energy's company page on Simply Wall St. We've also put together a list of important aspects you should further examine:

1. Historical Track Record: What has REPT BATTERO Energy's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on REPT BATTERO Energy's board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.